the gospel of foreign aid: a theoretical note

Rwanda Journal Volume 26, Series B, 2012 : Social Sciences42

ISSN 1014-4874DOI : http://dx.doi.org/10.4314/rj.v26i1.3

The Gospel of Foreign Aid: A Theoretical NoteBy Vincent Byusa

Abstract

After handing out more than USD 1 trillion in aid packages – including charitablegiving – to Africa over the last fifty years, only few countries are registeringmodestly improved Gross Domestic Product (GDP) growth and are making someheadway in reducing poverty. But for many sub-Saharan African countries, GDPgrowth remains insufficient to establish the momentum they need to exit fromprofound poverty. Worse still, in many cases, poverty is deepening. Understandingthis reality is the hallmark of successful aid for both donors and the world’spoorest countries.

The aim of this paper is not primarily to ask whether or not aid works, or in whichcases it does, but to contribute to a much needed process of understanding offoreign aid as an idea invented to overcome the problem of the poor. This requiresa research strategy that develops theoretical /analytical frameworks that capturethe complexity of Western and current Chinese generosity, namely the underlyingmotivation, rational and objectives.

Drawing on the vast literature on foreign aid, the essay explains how the idea wasframed, and how it has manifested itself in contemporary debates as a new typeand more complex instrument of foreign policy and economic development. Thepaper demonstrates a great degree of continuity in the policy concerns of the aiddiscourse from the Antiquity to Modern era where development assistance becomesa state responsibility, and politically organized as a balancing act betweendonor/receiver relationships and partnership. The paper concludes that, histori-cally, charity, poor-relief, foreign aid, development assistance – whatever it maybe called – has served a multitude of objectives in order to address specific policyconcerns of each period. Whether at its best or at its worst, foreign aid is here tostay as poverty still grips over a billion of world population.

Keywords: Economics, Foreign Aid, Charity, Poverty, Development.

IntroductionWhile the notion of foreign aid1 appears within the framework ofdevelopment assistance set up following the Second World War (WWII)

1 The review ignores military assistance and or arms transfers which date some2400 years ago. Ever since military assistance exists, some concealed interests

Rwanda Journal Volume 26, Series B, 2012: Social Sciences 43

and the independence of former colonies, the idea of transferring money,goods, and services from the rich to poor countries is not new. It is as old asthe prophets and as current as today’s headlines. Wealthy individuals andlocal religious bodies have always provided aid to poor compatriots.Certainly, religious ideology and moral principles must have guided theiractions. The purpose of the article is twofold: first to investigate themeaning of the religious and secular idea of aid; and secondly, to illustratethe main changes it has undergone in the course of the history.

It is appropriate in this kind of analysis to undertake a thoroughinvestigation into the practice of aiding the less fortunate in communityfrom the earliest periods of civilisation to modern period as most economicthoughts take their roots in ethical and religious systems that have had ahuge effect on Western culture and government. Such analysis reveals thetruer meaning, nature and scope of the current foreign aid flows, whichhave been under dispute for the last fifty years.

The paper does not question the positive impact that a charitable giving canhave on the recipient. It focuses on a neglected characteristic of Westernand current Chinese generosity, namely the underlying motivation andrational. Through a desk/literature review, the paper deepens theunderstanding of foreign aid as an idea invented to overcome the problemof the poor. It explains how the idea was framed, and how it has manifesteditself in contemporary debates. The rest of the paper is organised asfollows: sections 2 provides the historical account of foreign aid, section 3presents the lessons learned and section 4 concludes.

Foreign aid: origins and evolution of thinking

The central notion of “foreign aid” in economic perspective is complex andancient. As it goes even beyond the frontier of economics as science, theconcept is analysed with respect to the philosophical, theological and socialconstructs of the day deeply rooted in ancient beliefs. The focus oneconomic objective is in line with contemporary economic scholars(Easterly, 2001; Gordon, 1989; Haney, 1936; Hjertholm and White, 2000;Smith, [1776] 1981) who consider the impulse to share one’s wealth with

always accompany it. For example, during the Peloponnesian war (Athens againstSparta) military assistance was common and appeared to hinder peace anddevelopment in ancient Greece. A modern illustration of such concealed interests isthe France’s military and technical assistance to the 13 insurgent Americancolonies. After losing its North American empire, the American request for helpwas an opportunity for France to undermine Britain’s position in America.


the less fortunate and destitute in ancient societies as an economicbehaviour even though economics as science did not exist. Donors inAncient were rational since they constantly sought to maximize theirhappiness, honour or power and minimize their pain. In other words,benefactors always made rational choices.

The idea of aid in ancient times

The Jewish notion of aid2

In tracing the western historical development of the term “foreign aid”, letobserve that there is no logical necessity for treating oriental ideas as awhole; rather it is essential to assess the thought of the Hebrews and theirlater descendents Jews. No scholar can deny the fact that current westernreligious and moral beliefs come to Europe via the spread of Christianityand Judaism. It is valuable to bear in mind that other religious ideology hasalso guided the actions of benefactor. Yet, the fact that Christianity is thefounder of Western civilisation motivates the author to limit the focus onJudeo-Christian scriptures during the Ancient, the medieval and the earlymodern period. Besides, the ideal of foreign aid has successively helped torelieve famine and other humanitarian disasters in some part of the world. Itis, further, a plain fact that moral and humanitarian principles are behindthe Marshall Plan for European economic reconstruction and economicdevelopment of former colonies that embraced development ideal.

The source of knowledge for handing generosity and compassion all aroundand its earliest developments in western part of the world is, therefore, theBible – New International Version is used here. With reference to the HolyScriptures, the author takes, to a large extent for granted their authenticity.There is, however, good reason to be confident on its reliability andauthenticity in general and in particular to the New Testament writtenwithin two generation only. By way of contrast, scholars universally acceptthe authenticity of the early manuscripts of Plato, Aristotle or Julius Caesarwritten more than 1000 years after their death.

Justice and righteousness are core values of the Jewish religious belief.Moreover, justice and righteousness are not separate virtues, activities orresponsibilities. According to the Bible (1999), the just or righteous person

2 The foreign aid historical review starts with ancient Hebrew contrary to mostacademic literature, which considers ancient Greeks as the first civilised people touse their reason to think systematically about the world around them. The authorprefers the approach for practical reason: the itinerary from Orient to West viaGreece makes reasoning much clear.


is one and the same (Isaiah 24:16). Justice and righteousness are indeed theliteral translation of the Hebrew word zedakah3 (Posner, Ben-Sasson, andLevitats, 2007, p. 569). From a religious and ethical point of view, theritual observance of zedakah and Mitzvah is the greatest Biblicalinstructions, the principle and goal of Jewish moral perfection (Proverbs21: 3). In a popular view, Zedakah means commitment to or actingaccording to God’s covenant. As Bromiley (1982, p. 193) suggests, bygiving to poor Hebrew people believe that they are fulfilling the “demandof a relationship, either with God or with other human being”. The ideal ofzedakah is therefore an invitation to materially assist the poor not only asan act of compassion but also as a legitimate, lawful and virtuous act.

Nevertheless, the ideal of zedakah has a broader and deep social andeconomic dimensions and implications for the teaching of economic justicein these days. It brings an apparent justice based on religious and moralideologies without tackling the real cause of poverty. Contrary to theopenly declared objective of the current foreign aid, prophets do not believethat zedakah can eliminate poverty once and for all. They do not even havethe intention to do so (Deuteronomy 15:11). The objective is to controlpoverty and not to eradicate it, or change the social or economic status ofthe poor. Rather Mosaic Law encourages a certain social solidarity amongHebrew as the divine sense of community guides their moral thought. TheMosaic Law is simply a preventive poor-relief since attempt to separatejudgments of value from judgments of fact remains an unsettled issue.

The Greek notion of aidOnce the attention is shifted from Oriental nations to West, ancientPalestine finds a serious rival in the ancient world. The parallels in theGreeks myths with Hebrew religious custom of righteousness indicate thatancient Greeks are fully cognisant of the central idea of gift to poor. Thisdoes not mean that ancient Greeks accept all Hebrew ideas, even though thesympathy for broken and destitute people receives widespread support inancient Greek society. Difficult and hazardous are, however, words chosento describe ancient Greek goodwill since there is no Greek word thatcompletely corresponds to, and covers every aspect of the Hebrew notionof Zedakah.

Nevertheless, Robbins (2005, pp. 1757-1758) suggests that Greeksbenevolent deeds take its roots in the speculative and religious idea of

3 The Septuagint usually renders the Hebrew idea of zedakah as eleos oreleomosyne but has come to mean alms.


philanthropia along with it synonymous agape, eleemosune, or eleos, erosand philia. Literally philanthropy means love of humanity. Ancient Greeksuse, however, the term often loosely when refereeing to righteous deeds,compassion for the afflicted and loving hospitality for the stranger.

For much of recorded ancient Greek gift-giving history, the general view isthat the idea of philanthropy emerges as a sign of love or compassion ofancient Greek god Prometheus for humankind. Here again, one may noticethe divine nature of gift found in Hebrew. Ancient Greek mythologiesportray god Prometheus as “the friend and benefactor of mankind” forendowing humankind with wisdom, arts, sciences as well as the means tosurvive (Penglase, 1997, p. 220).

Ancient Greek benevolence is, therefore, an imitation of gods’philanthropy. Illustrative is the homer’s Odyssey – and Iliad, where hestrongly emphasises on moderation, generosity, sharing and hospitality asforms of philanthropy. For example, in following English translation of thefamous epic of Odyssey, Homer expresses his gratitude to both Zeus andEumaeus:

Here I sit, in distress and grief for my kingly master, …while he, itmay be, is wandering foodless about some town or region of foreignspeech…And with those words he the way to the cottage door andushered his guest in…Odyssey rejoiced at such a welcome anduttered his thoughts loudly: ‘My host may Zeus and the otherdeathless gods reward your generous welcome to me by granting youwhat you most desire!’Eumaeus the swineherd answered him: ‘My guest, I should think it amonstrous thing not to honour my guest who come to me, even onemore miserable than you, because Zeus is patron of every strangerand every beggar, and to such as these, even so humble a gift as minemeans much.’ (Homer, 1998, Odyssey, Bk. 14, ll. 38-57).

Though Homer dwells on hospitality at some length, his intention is tocontribute to the ethics teaching.

With time, the religious connotations and the religious quality of gift-givingbecame more and more secular; and hospitality and philanthropy of theambitious developed new forms, such as tax exemption, land redistributionor provision of medical services at no cost. Illustrative is the Aristotle’sdescription of the Athenian tyrant Pisistratus (1984, The Athenianconstitution, 16):

In general he was humane, mild, and forgiving to wrongdoers, and inparticular he lent money to those who were in difficulties, to supporttheir work, so that they could continue to maintain themselves byfarming. … he won over the notables by his friendly dealings with


them, and people by his help for their private concerns, and hebehaved honourably to both.

In practice, Pisistratus extends Solon’s reforms by distributing land grant topoor4, giving tax exemption, and sponsoring various constructions andimprovements in the city. Furthermore, in the writings usually attributed tothe Greek physician Hippocrates for example, one reads the followingEnglish translation:

I urge you not to be unkind, but to consider carefully your patient’ssuperabundance or means. Sometimes give your services for nothing,calling to mind a previous benefaction or present satisfaction. And ifthere be an opportunity of serving one who is stranger in financialstrait, give full assistance to all such. For where there is love of man,there is also love of art. (Plato, 1923, p. 319)

One may note that public and general care for the poor is absent at thebeginning in most Greek city-states. Public help to the poor in ancientGreece only emerges with the intolerable inequality between rich and othersocial groups. Its motivations are, therefore, policy consideration ratherthan benevolence. The practices, desires, and forms of thought, by whichpeople who have special advantages of wealth engage in public generosityare only encouraged if the well-to-do acted as benefactors to thecommunity. In most case aid takes the form of voluntary contributions –money or other material aid – to help the poor. Other forms includelegislated gifts for unnecessary ends such as festivals and choruses,equipments and decorating objects, and philanthropic donations.

Yet, the interest in rational evaluation of the ancient Greek gods’ goodnessthat cause human to do good things emerges in the fifth century BC withSocrates in the dialogues of Plato. The reader of Plato’s dialogues (TheEuthyphro; The Republic) discovers a Socrates who becomes sensible ofsome incongruity in a fictitious history of value judgements; and reveals hisown thoughts about divine and human perfection. Plato has Socrates say inthe Republic that: “For good things are far fewer with us than evil, and forthe good we must assume no other cause than God, but the cause of evil wemust look for in other things and not in God” (Plato, 1956, 2.18). It followsthat gods are only authors of good things and communicate their goodnessto human through philanthropy, a form or model of the ideal good. InPlato’s view, once the person knows what the ideal good is; actions thatfollow are necessary in harmony with the good for its own sake.

4 Noting that in the previously years, “All the land was in the hands of a few”(Aristotle, 1984, The Athenian constitution, 2)


This approach to Aristotle’s Ethics that takes the notion of virtue as apractical attitudes and habits of doing what is right and avoiding what iswrong has fundamentally influenced many economic scholars (Marx, 1976,c1967; Smith, [1759] 1982, [1776] 1981). Today, many philosophersaround the world share the virtue of goodwill. Plato, Aristotle, and theirfollowers are seen as excellent contributors to the development of a moraltheory that explains gift-giving practice. The issue of how best tounderstand the notion of hospitality, love, philanthropy, and the like, andthe underlying moral obligation in ancient Greek is therefore important. Itcan strongly influence one’s view of what, if any, theoretical problemsmight be associated with the notion, and further, if there are problems, whatmight count as a solution. Theoretical reflection on moral virtue hashistorically relied upon Plato and Aristotle writings mainly5. Itsinterpretation has to be understood in the context of their small economyalmost self-sufficient and based on land and slavery. Their focus is chieflyon the management of the household, on ideal communistic state and onthat teaches to look for happiness through gift-giving6.

The Roman notion of aid private property. Thus, donating or beingphilanthropic is limited to EthicsIt is natural to pass from Greece to Italy, both by history, geography and bythe character of Roman lifestyle. The care for the poor did, however, notcome naturally to the ancient Romans as it did to Greeks and Hebrews.Nevertheless, it would be absurd to suggest that ancient Romans wereunwilling to recognise the needs of the poor. It would have been suicidal tohave taken such stand, and not viable for the Roman expansion andcolonisation.

In a formal way, the policy on the provision of organised aid and servicestook two forms: network of government institutions and private generosity.There is, however, little sign of government intervention except in rareoccasion. The standard and generally accepted response to poor problems

5 These are major ancient great philosophers. Yet, philosophers such as Zeno, thefounder of stoicism (see Wenley, 1924?), and his followers have had remarkablyinfluence on the practice of material aid and services. They widened the virtue ofbenevolence to include toleration, love, gratitude, charity, patriotism, andphilanthropy to accommodate the living under roman occupation.6 A close and related practice is the gift-exchange, a structural element of thepeasant and gift economy. In gift-exchange economy, the giver expects therecipient to reciprocate. It is not gratuitous. Though it is now an essential part ofsocial behaviour, it may be compared to trade practice of 19th century.


was a self-motivated almsgiving called euergetism (Atkins and Osborne,2007). Yet, both public and private generosities have one major andcommon characteristic: the recipient is not clearly defined as poor. Andobviously, aid was not directed to the poorest, and even if it happened itwas out of fear of unrest event.

Illustrative is the old Roman custom of “food distribution” from the fifthcentury BC onwards, which is probably Greek in its simple character at thebeginning (Lanciani, 1963, p. 126). Whether for the sake of politicalsurvival or other motives, much of the ruling elite’s generosity consists ofselling grain at a subsidised rate to Roman citizens, mostly upper class andsoldiers. The use of food distribution technique for social order evolvedgradually, but not continuously, over many years from a simple to a morecomplicated and became a general policy. In 58 BC, Publius ClodiusPulcher modifies the law and distributes grains gratuitously (Bartlett,1994). Later on, Roman benefactors add wine, oil and meat to grain doles.Above and beyond the foodstuffs distribution, Rich Romans who seek apolitical career display their generosity for all by building publicinstitutions such as hospital – of course not in modern sense of the word,libraries, and give money at some great public event. Since these gifts havea political motivation, high publicity and ostentation generally accompanythe gift-giving ceremony in order to call attention to benefactors and theirgreat generosity. The quest for glory on national and personal level is awidely held feature of Roman disposition. Generosity is just an effectivemeans to approach the masses and gain their popularity. Choosing the rightgift is therefore important as it can influence the outcome.

Common sense suggests that the Roman gift-giving practice is a way thatpeople use to seek friendship for a variety of objectives such as honour,power, or glory. According to Cicero, this Roman behaviour is a product ofthe virtue of justice and beneficence or charity (1928, De Officiis, Bk.1) butvirtues that exclude the idea of helping all needy (Cicero (1928, DeOfficiis, Bk.2.18.61-62):

The case of the man who is overwhelmed by misfortune is differentfrom that of the one who is seeking to better his own condition,though he suffers from no actual distress. It will be the duty ofcharity to incline more to the unfortunate, unless, perchance, theydeserve their misfortune.

The emergence of a real concern for the poor as a separate group within theRoman world appears, however, after the republican era of Cicero in theworks of the stoic Seneca. In his handbook on appropriate gift-giving andreceipt, he urges his fellow Romans to be generous as much as possible and


the way to hand out the gifts: “Help one man with money, another withcredit, another with influence, another with advice, another with soundprecepts.” (Seneca, 1958, De Beneficiis, Bk.1.2.4).

In the more strictly economic realm, Ancient Rome was an agrarian andslave based economy whose main concern was to feed the vast number ofcitizens and legionaries at no direct monetary cost. The ostentatious gift-giving allowed rulers to gain popularity within the social inferiors throughfree corn distribution. Ancient Rome can, however, not be qualified as awelfare state. Grains and other foodstuffs distribution are primary for thecitizens as a right rather than the poor because like the ancient Greeks, thechief objective for Roman rulers is the beauty or the improvement of thecity. The care for the poor by the state is not a real concern. Strategy ratherthan by benevolence dictates virtually all state relief. Roman generosity istherefore a simply political measures designed to calm the Roman massesclamouring for bread.

The apostolic and patristic idea of aidIt is no wonder that as applied virtue, zedakah passed into popular usage tomean caritas i.e. charity, a translation of the Geek word agape in theVulgate Bible7. In Christian tradition, caritas becomes a mode of divineworship and rituals gift-giving. The most distinctive and original feature ofChristianity is, however, its attitude towards the Hebrew idea of zedakah,and its Latin and Geek equivalents. Christianity brings a change inconnotation of these words and the image they represent.

Naturally, Christianity arises from full Jews firstly, and then developsamong Greeks and Romans. Besides, the first generation of Christianevangelists not only inherit Jew scriptures, cultural practices andorganisation; but also Greco-Roman thoughts play an important role inshaping Christian dogma. Studies (Chadwick, 1990; Green and McKnight,1992) indicate, however, that Christianity is the first religion to spread topeople on every continent the message of love, generosity, human rights,equality, justice and freedom.

Until the early fifth century A.D., Christians use the Greek version of theBible. Nevertheless, the terms Christians use to express the ideal of loveand self-sacrifice for the greater good in Old Testament and in New

7 One may observe that the word charity comes into English usage from the oldFrench charité in 1154 (Oxford English Dictionary, 2007, s.v. Charity). Thetranslation from old caritas – a Latinised word of the Greek word charis – tocharity evolved gradually. Protestant Bibles render agape as love.


Testament obtain distinct and different meaning in Roman Empire. Inparticular, and following Paul – the Hellenised Jew with Roman citizen andapostle of Jesus Christ – the New Testament exclusively and constantlymakes use of the Greek word agape. To understand the importance and thespecial meaning of agape for Christians, it is necessary to look at Paul’sletter to Corinthians in modern English translation:

Love is patient, love is kind. It does not envy, it does not boast, it isnot proud. It is not rude, it is not self-seeking, it is not easily angered,it keeps no record of wrongs. Love does not delight in evil butrejoices with the truth. It always protects, always trusts, alwayshopes, always perseveres. … But the greatest of these is love. (1Corinthians. 13: 4-7, 13).

Love stands here for agape. Paul introduces the use of the term agape intothe New Testament but assigns to it a special meaning (Nygren, 1982). Acloser investigation reveals that the ideal of love for humanity is alreadypresent in a very rudimentary form among the Greeks and Romans but therise of the Christian agape supplements philanthropia and eleomosyne.Within the Christian tradition, the Pauline notion of agape guides allChristian philanthropic works. Christian philanthropy and fellowship withGod become the expression of agape, since “God is love” (1 John 4: 8).

Things changed with the year 312 – which marks the momentousconversion of Emperor Constantine – and later in 389 when his successorTheodosius I was able to make Christianity the sole official state religion ofthe Roman Empire (Chadwick, 1990). Gift-giving becomes a lovingpractice of the unlovable in Greco-Roman world. Emperor Constantinehimself gave the example by broadening the scope of imperial assistance.Furthermore, during his reign laws that invested Bishops with socialsignificance with huge financial resources to alleviate suffering among poorand needy were voted. In so doing, Constantine and his successors publiclyacknowledged the new ideal of Christian care for the poor. Indeed, asHorden (2005) observes, Bishops not only gave foodstuffs and clothes topoor but also funded hospitals and houses of care.

In the Vulgate, St. Jerome intentionally renders the Greek word for agapeas caritas. Essentially, St. Jerome uses the Latin word caritas in its narrowsense to denote the practice of giving aid to these less fortunate. SinceChristians idealise interpersonal love with God, for St. Jerome caritasmeans the voluntary and disinterested form of love or sacrifice that oneperson makes for the good of another. In practice, caritas is the product oflove that materialises in generosity, a way of Christian life.


The imagery St. Jerome uses to express caritas derives from the Hebrewcovenant with God. He voluntary overlooks the Roman ties that link caritasto sexual and military things, and focuses on spiritual love. One may,therefore, infer that St. Jerome’s intention is to build a strong moral basisfor granting aid to poor under the great law of Christianity “…love yourneighbour as yourself” (Luke 10: 27).

As a result, the Latin spelling of caritas included all types of benevolencepractices associated with the highest form of love (1 Cor. 13: 13). It followsthat the crucial insight that emerges from the Greek and Roman conversioninto Christianity is that caritas turns out to be an obligation or a duty for allmembers of society. Charity begins therefore as a wonderful word.Accordingly, Christian’s benevolence entails the love towards earthlydisadvantaged and works of charity and justice.

The medieval and renaissance idea of aidThe Middle Ages witnesses a real expansion and crystallisation ofgenerosity doctrine for the needy in Western Europe. Generally, the MiddleAge period8 runs from the fall of the Western Roman Empire in 476 downto the fall of the Eastern or Byzantine Empire in 1453. Yet, the authordeliberately extends the period to include the Renaissance and Humanismera. The tension between tradition and innovation during this period laysout obvious shifts in subject discussion and nomenclature.

The 11th and 12tth centuries mark the development of a commercialeconomy, the rise of commercial centres and the expansion of citypopulation. The revolutionary expansion of the gift economy to marketexchange economy, however, shakes up the existing institutions, socialgroup and the prevailing Christian morality (Little, 1978). During thisperiod, the word charity passes into English use, and has the general Latinsense of benevolence to the poor.

Charity rises up again in the writing of St Thomas Aquinas (c1964) in 13th

century. He stresses that the Biblical command of love involves, indeed,both charity and justice towards the poor and the weak. Aquinas, however,lays great stress on goodness of giving to several poor rather than relievingone needy than necessary. Yet, most of the time, persons who speak ofcharity and justice assume that everyone understands what the phrase

8 The accurate dates for the beginning and the end of the Middle Ages are subjectof discussion. Yet, as Wood (2002) and Haney (1936) point out, the opening andclosing dates of such period must be an open interval of time, i.e. form the fifthcentury to the fifteenth century.


means. In practice, however, what constitutes justice for one group; theother group perceives it as injustice.

Until the mid-14th century, the church administrates and controls almost theavailable poor-relief resources of which almsgiving forms the mostimportant element. Moreover, poor-relief becomes more discriminate, andeven much more complex as a result of the unexpected calamity of theBlack Death, which kills multitude of people in recorded history of Europeduring the period 1348-49. The most immediate and obvious effect of thewidespread killing is to create a shortage of labour, although, it solves theproblem of feeding too many people. The first and direct secular reaction tothe Black Death and economic distress is to take control of relief measures.The public authorities’ involvement, however, proceeds at varying ratethroughout Europe.

A comparative study of poor-relief within England and the rest of Europelies beyond the study’s scope. The review tries to generalise the notion ofpoor-relief i.e. charity in Western countries. Nevertheless, it acknowledgesconsiderable variation within them due to specific customs and how theybroke with Rome. Very broadly, however, charity ideal remains in force;even though the “Statutes of Labourers” indicate an evolution of attitudestoward the poor.

In 1601, the Queen Elizabeth I of England enacts a new poor law based onthe experiments of the earlier Elizabethan poor law of 1598. The documentputs an end to the religious exclusivity of charity works and paves the wayfor secular charitable works as instrument of social construction.Subsequently, this and other Elizabethan poor laws become the foundationon which Britain, American colonies and other Western countries erectmassive and elaborate structure of poor relief law (Harris, 2004; McIntosh,2005).

Considering the fact that no economy produces the wealth required tosupport its social policies prior the 18th century, the implementation of atotal shift from the Roman Catholic Church based charity – despite theconfiscation of most of its properties, legacies and income – to statedirected poor-relief seems unlikely. Obviously, many of the medievalCatholic institutions continue to provide charity to poor alongside themunicipal “common chest” and state poor-relief wherever needed. Legallyspeaking; however, reformers emphasise on the responsibility of the statefor poor-relief and its secularisation rather than a church responsibility. Inpractice, the local municipality has the responsibility to care for its poor.The structure of European public relief in the 17th century is, however, acomplex structure. It combines independent, voluntary and mutual


associations, and statutory bodies that provide relief to poor. Each group,however, preserves its religious heritage whether from Roman Catholicbackground or Protestants; and the poverty policy response depends ondonor’s specific religious orientation. When one recalls, French Huguenotsand Ireland Protestants who sought refuge in England relied on Englishcharity for their accommodation and meals. Thus, country’s approachtowards the poor depends on its institutionalised social and religiousdoctrines. In Scandinavian countries and Germany – which are mainlyLutheran, poverty is societal problem; while in England, Netherlands andUnited States of America – predominantly reformed protestants – povertyis an individual failure. On the other hand, catholic countries – such asFrance, Italy, and Spain, poverty is not only part of natural order andpermanent element in the social structure but also it is a virtue and as suchno debate takes place.

In short, on may say that prior to the Reformation, the church plays aleading role in poverty alleviation even though spiritual needs of mankindconstitute its main concern. It is only in 16th century that men and womensystematically shift their religious preoccupations to secular concerns ofhuman well-being. Efforts to eradicate poverty embody both state poor-relief that aims at controlling poverty, private philanthropy generally takingthe form of money to meet human need and foster excellence, and the oldchurch based charity as social observance and virtuous act. The novelty ofthe 17th century charity is the attempt at organising poor-relief on a muchgrander scale i.e. province rather than the village for efficient use of factorsof production.

Aid in modern timesOne cannot date exactly the beginning of the modern era of the Europeansociety since it is purely relative. Nevertheless, the changes in economicactivities that occur during the years following the industrial revolution inthe Kingdom of Great Britain are extraordinary. They mark a new trend ofthought that affirms the power of human beings to create or improve thesocial and economic living conditions.

Like other innovations that occur in Western society, the need for, theattitude towards, and the ability to practice charity lead to a decisivechanges in the nature of the already existing institutions. Under theleadership of religious and secular humanitarians, struggling workers andother less fortunate develop new ways of working together. Specifically,charity schools’ capacities increase, hospitals become more specialisedinstitutions, and peasants, farmers and factory workers form mutual aid,


associations, labour unions, clubs and societies. It would be hardlyrewarding to speculate at length on the motives which inspirephilanthropists to donate huge amount of financial and non-financialresources for public purposes. Human behaviour rarely shows signs ofhelpful singleness of motives.

A more international form of charity, however, appears as a necessaryconsequence of the European wars, growth population, the success of theBritish industrial revolution, and the need for overseas missions.

The history of European colonisation of America suggests that eachEuropean country made every effort to assist financially and technically itscolonies from which it gained raw materials as well as customers of itsmanufactured goods. Such movement of labour and capital constitutes amilestone in the history of foreign economic aid in peace time. Pointing upancient Roman colonisation model, Smith ([1776] 1981, WN, Bk.4.7.2)observes that the mother country “considered the colony as a child, at alltimes entitled to great favour and assistance, and owing in return muchgratitude and respect”. It is for that reason that Great Britain works togetherwith Philanthropic bodies to provide helpful advice about ordering andimproving economic conditions in its former colonies and trade partners.According to Smith ([1776] 1981, WN, Bk.4.7.166) such policy is mutuallyadvantageous as “[it enables] them to relieve one another’s wants, toincrease one another’s enjoyments, and to encourage one another’sindustry”.

France’s greatest innovation in the field of international assistance,however, appears during the American war for independence againstBritain, the historical France’s enemy. Not only the French governmentsupplied military equipment to the 13 American colonies, but it alsoprovided them financial and economic assistance. Obviously internationalpolitics and alliance opportunities were behind the French assistance.

However, the first cross-boarder state organised humanitarian aid to relievesuffering people appears on March 26, 1812 (Curti, 1963). The 1812 foodaid Act in favour of Venezuelan earthquake victims sets a precedent for thecongress of the USA. By taking the decision to grant aid to Venezuela, theUSA made a step into silent marketing and a host of other ulterior motives.Being the world’s powerful and leading manufacturing nation withenormous food surplus from the late 19th century onwards, the USA startedto use its food surplus or its navy for market development and internationaltrade (Hjertholm and White, 2000). This led the USA to support the Greekgovernment against the Ottoman Empire in 1821 and to assist the Irelandand Cape Verde Islands during catastrophes and famines.


Closely related to American food aid is the American technical assistance.From the early technical work in agriculture, American experts were activein Turkey, Japan, Cuba, Haiti, and Liberia. On balance, however, Americanforeign technical assistance was inconsequential until the late 1940s.Indeed, American experts have never been interested in a broad-based grassroots approach to development. Rather the US foreign economic policyrelies to a great extent, albeit not always with desired outcome, on itsexperts – generally well paid – to serve national and private interests.Foreign governments frequently contract these US experts to offer technicaladvice at astronomically high price. As Curti and Birr (1954, pp. 41-42)9

points out, the American advisor to Japan’s Hokkaido Developmentcommission Horace Capron, requested in 1870 to have “his expenses paidto and from Japan and to be given a house, guards, and servants – and toget $10,000 a year. This was a handsome salary for an American publicofficial and considerably more than that of the prime minister of Japan.”The success of this well paid job was, however, a mixed blessing for Japan.Studies show that Japan witnessed a rapid growth in agricultural output andproductivity under Capron. In the long-run however, the policy adviceturned out to be inefficient as the agricultural production declined somedecades after Mr Capron had left.

It is worth noting that prior to the late 1920s colonial powers were reluctantto act in the areas such as social security, health or education. Colonialrulers made little effort to develop their colonies, economically, socially orculturally. Colonial assistance if any was only incidental to the process ofaccumulating and extracting of wealth from the colony. Such colonial aidincludes loans for dedicated infrastructures and grant for a limitededucation and health care. Contrary to American colonisation and othersettlement colonies such as Australia, Canada, New Zealand, and SouthAfrica, exploitation colonies did not experienced the same flow of factorsof production that helped to create wealth. Unlike the immigrants in mostsettlement colonies, colonist in exploitation colonies continued to regardthemselves as outsiders rather than local entrepreneurs. Any colonialassistance was an instrument of trade, colonisation and exploitation.

Yet, official bilateral financial aid from a wealthy country to a poor countrygrew out of President Truman’s declaration of foreign policy and nationalsecurity principles as the US became a worldwide donor. While addressinga joint session of the Senate and the House of Representatives on 12 March1947, President Truman not only recommended assistance to Greece and

9 Quoted in Kanbur (2006, p. 1563)


Turkey, but also outlined the priorities and mission for US foreign aid andnational security principles that has, since then, guided Americanleadership. In his speech10, he states that:

The foreign policy and national security of this country are involved.… The United States has received from the Greek Government anurgent appeal for financial and economic assistance…. Greece istoday without funds to finance the importation of … goods which areessential to bare subsistence.…Greece is in desperate need offinancial and economic assistance to enable it to resume purchases offood, clothing, fuel, and seeds.… The Greek government has alsoasked for the assistance of experienced American administrators,economists, and technicians to ensure that the financial and other aidgiven to Greece shall be used effectively in creating a stable and self-sustaining economy and in improving its public administration.…There is no other country to which democratic Greece can turn.…The British Government … can no longer extend financial oreconomic aid to Turkey…. We shall not realize our objectives,however, unless we are willing to help free peoples … This is … afrank recognition that totalitarian regimes … undermine … thesecurity of the United States….it must be the policy of the UnitedStates to support free peoples … through economic and financial aid… in the amount of $ 400,000,000. ([Online] Truman, 1947, pp. 1-19)

Present Truman’s humanism is the most puzzling feature of early USforeign aid that affirms the goodness of altruism and the protection of freepeople while promoting US economic and security interests. According toMcCullough (1992, p. 548), the US Senate approved the 400 million USdollars11 in aid package to Greece and Turkey on 22 April 1947, and thePresident sanctioned the deal one month later. Although the Greekgovernment wanted more, donating USD 200 million for a period of 12months – whether it includes the payment of American civil and militarytechnical experts working in Greece – was the first bilateral aid of its kind.

On 5 June 1947, less than two months after the bilateral aid agreementsunder Truman Doctrine, the then US Secretary of State General GeorgeCatlett Marshall announced the most generous programme to reconstructEuropean nations during his speech at Harvard University. Despite UnitedNations (UN), WB and IMF interventions through which US channelled agreat deal of money to help Europe to recover, Marshall portrayed

10 Generally referred to as “Truman Doctrine”.11 Using the consumer price index that amount is equivalent to USD 3.8 billion in2010


European economic condition as follows; and announced his recovery planin the following words:

I need not tell you that …confidence in the local currency has beenseverely shaken. The breakdown of the business structure of Europeduring the war was complete. Recovery has been seriously retardedby the fact that two year s after the close of hostilities a peacesettlement with Germany and Austria ha s not been agreed upon. Buteven given a more prompt solution of these difficult problems, therehabilitation of the economic structure of Europe quite evidentlywill require a much longer time and greater effort than ha s been foreseen…. The truth of the matter is that Europe’s requirements for thenext three or four years of foreign food and other essential products -principally fro m America - are so much greater than her p resentability to pay that she must have substantial additional help or faceeconomic, social , and political deterioration of a very gravecharacter…. I t would be neither fitting nor efficacious for thisGovernment to under take to draw up unilaterally a programdesigned to place Europe on it s feet economically. This is thebusiness of the Europeans. The initiative, I think, must come fromEurope. The role of this country should consist of friendly aid in thedrafting of a European program and of later support of such aprogram so far as it may be practical for us to do so. The programshould be a joint one, agreed to by a number, if not all, Europeannations. ([Online] Marshall, 1947, pp. 1159-1160)

Almost one year after Marshall’s speech, the Congress overwhelminglyapproved the “Economic Cooperation Act”, which became effective on 3April 1948 under the name of “European Recovery Programme” (ERP) butgenerally referred to as “Marshall Plan”. From 1948 to 1951, the USdisbursed more than 13 billion US dollars in grants for the ERP12

(McCullough, 1992, p. 565). The Plan’s objective according to Marshallwas to help European partners to achieve the status of self-supportingnations and be able to buy US goods and services. Americans andEuropeans considered, however, the ERP as an emergency plan – and notas a permanent programme.

As researches by Hattori (2003) and Opeskin (1996) show, it is difficult torule out the traditional religious idea of charity or the humanistic motivesinherent in natural law behind the idea of international transfer of resourcesfrom rich nations to poor and developing countries. The USA and otherformer colonial powers are generally guilty for centuries of colonialism andsin of slavery. Nevertheless, the American sponsored ERP had no moral

12Equivalent to more than UDS 107 billion in 2010.


dimension. Its main purpose was not charity but the safeguard of US tradeand security interests in Europe. The reconstruction of Western Europe wasfundamental to ensuring United States’ prosperity. Though most Europeansnations were thankful, President Truman did not expect any praise fromEuropeans as he put it unequivocally: “I am doing it because … it’snecessary to be done, if we are going to survive ourselves” (McCullough,1992, p. 583).

The unexpected rapid success of the Marshall Plan created, however,external economic and political environments that coincided withideological aspiration, economic and security interests. Economic andsocial development –as opposed to European Economic Recovery –becomes one of the four major Truman’s objectives during his second term.The fourth point of his inaugural address delivered on 20 January 1949,says that:

Fourth, we must embark on a bold new program for making thebenefits of our scientific advances and industrial progress availablefor the improvement and growth of underdeveloped areas. More thanhalf the people of the world are living in conditions approachingmisery…. Their poverty is a handicap and a threat both to them andto more prosperous areas. For the first time in history, humanitypossesses the knowledge and skill to relieve suffering of thesepeople. The United States is pre-eminent among nations in thedevelopment of industrial and scientific techniques…. I believe thatwe should make available to peace-loving peoples [democratic andindependent countries] the benefits of our store of technicalknowledge … This should be a cooperative enterprise in which allnations work together through the United Nations and its specializedagencies whenever practicable…. With the cooperation of business,private capital, agriculture, and labor in this country, this programcan greatly increase the industrial activity in other nations and canraise substantially their standards of living…. Guarantees to theinvestor must be balanced by guarantees in the interest of the peoplewhose resources and whose labor go into these developments…. Allcountries, including our own, will greatly benefit from a constructiveprogram for the better use of the world's human and naturalresources. Experience shows that our commerce with other countriesexpands as they progress industrially and economically…. Only byhelping the least fortunate of its members to help themselves can thehuman family achieve the decent, satisfying life... Democracy alonecan supply the vitalizing force to stir the peoples of the world intotriumphant action, not only against their human oppressors, but alsoagainst their ancient enemies – hunger, misery, and despair.([Online] Truman, 1949)


Though the rhetoric demonstrates great similarity with the classic publicspeaking on generosity, Truman’s inaugural address marks a turning pointin US foreign aid policy. To the humanitarian aid, President Truman addstechnical and financial assistance. Such alluring speech during the earlyCold War era and at the beginning of European decolonisation of Asia andAfrica has obviously created an illusion about a possible developmentthrough foreign aid. Not only the Marshall Plan trigged a remarkabledevelopment of Western European economies, but also the enthusiasm ofthe new bilateral and multilateral institutions to extend their help tounderdeveloped countries was equally inspiring to Truman’s proposal.

The US containment policy, however, jeopardised the translation ofTruman administration rhetoric into reality. The US involvement into wars(Korea and Vietnam) wiped out the prospect of an extension of theMarshall Plan. Only a handful and strategic countries outside WesternEurope benefited from the American generosity, namely Japan, Hon-Kong,Singapore, South Korea, Taiwan and Israel.

Nevertheless, President Kennedy renewed the commitment to globalpoverty reduction but refocused the security concerns of previousadministrations from containment to development. The foreign aid policythat emerged under President Kennedy emphasised on coordination of bothbilateral and multilateral transfer of large financial flows. This lead to thecreation of the United State Agency for International Development(USAID) and the switch from OEEC to the Organisation for Economic Co-operation and Development (OECD) with a Development AssistanceCommittee (DAC). The change came just as US was helping toinstitutionalise foreign aid while Western industrialised countriesconsidered the sustainability of their own growth as a pre-condition to thesupport of the developing world.

In the years after the Marshall Plan success, the assumption that foreign aiddoes help underdeveloped countries to develop their resources and improvetheir living conditions became increasingly accepted for most peopleactively concerned with aid programme. Foreign aid, therefore, emerges asthe primary mechanism designed to not only to help the newly independentnations to grow fast, but also to restrain the spread of communism, and toincrease trade and business. Nevertheless, more often than not, aid operatedaccording to the law of unintended consequences.

The paper focuses primarily on western idea of foreign aid. Nevertheless,the rise of China (People’s Republic of China) as a very visible nonDevelopment Assistance Committee (DAC) actor in foreign aid businesshas sparked considerable criticism in western literature (Brautigam, 2008).


Chinese foreign aid is termed “external economic cooperation” to give theimpression that she focuses on the much needed progress in the recipientcountry. She pretends to be guided by a principle of “equality and mutualbenefit,” or a “win-win” relationship. Yet, this happens to be a myth. China– like other western donors, uses aid as an instrument to increase as manyfriendly countries as she can to support her values and interests. China forexample opened doors to every country in Africa except Swaziland becauseof her ties with Taiwan.

Lessons learned over the historical review of the origins of foreign aidAid is rationally desirable

The foregoing historical review reveals that foreign aid – understood as aidto foreigners i.e. strangers and neighbours – and its sources are closelyrelated. The nature of aid lies in its voluntary nature, and requires freedomand gratitude on both sides. In the light of ancient beliefs, rich individualshave the moral responsibility to help the poor within their family,community and nation. Ancients show a more realistic approach to povertyas rich class double up as landowners, politicians and rulers responsible forthe prevailing social injustice. Thus, recommending the goodness of givingbecause God says so or because it is the right thing to do providesincentives for the rich to ease the suffering of the poor. The fact that thenotion is a religious – or simply ethical – one, carries with it enormousgoodwill; and ruling elites bask in its glow. Once the society buys the ideaof giving, its charm makes it easier to intimidate and impose to the wealthya moral obligation of generosity. The failure to relieve human misery didnot, however, lead to new ways of serving the poor.

The morally right turns out to be politically expedientAid is not the right thing to do when one party exploits and oppressesanother. The evidence is overwhelming that sympathy for the well-being ofothers is only a supporting objective to selfishness and the desire forwealth. The use of the words charity, aid, assistance and the like istherefore inaccurate and inappropriate if the objective is to render justiceand to love the neighbour. The point of concern here is the use of emotivewords extracted from the ordinary language to obstruct the separationbetween means and ends.

Nevertheless, aid actors have more often than not used gifts to promotespiritual welfare of both recipients and donors, buy and maintainfriendship, and forge alliances. Basically, they used aid to ensure the


existing social order and to promote the interest of the donor. Aid is animplied rather than an expression of justice and love of humankind.

Hard-headed self-interests complement strong moral obligation

Aid is not a free lunch. People never do anything for nothing. Aid comeswith many open and hidden agendas difficult to trace. The donor alwaysgets something out of it. The benefits have even extended to aidadministrators while just helping the poor to survive instead of eliminatingpoverty.

In traditional societies, men of the prayer and men of the pen assert on menof wealth a moral duty to give to one’s fellow man, including the provisionpublic goods without expecting anything in return. An examination of thepractices of the wealthy in contributing to the well-being of his community,however, shows frequent preference for assisting particular poor orassisting in particular ways that suggest more than a measure of self-interest. In classical Western society, the Church sees men’s participationin solidarity and brotherhood efforts to try to wipe out poverty and diseasethat affected the most vulnerable as a God-given law. The vagaries of thepatronage systems, however, show that charity or parish poor-relief doesnot prevail over other factors. Evidence shows that the underlyingmotivations were the safety and the salvation of souls of the donors throughtheir remembrance in the prayers of the Church and recipients and politicaladvantages. Aid to poor stemmed from fear of eternal punishment andpossible social conflicts. Thus, donating to poor through the Church toensure impersonal distributions guaranteed huge spiritual rewards. Inmodern world, the proposal to meet human needs shifts from individualhousehold responsibility and sense of community and neighbourliness tothe state. From the very beginning, politicians and tyrannical governmentsstrive to use the vocabulary of religious morality in their power plays and toeliminate Churches as competitors for moral authority. The inaccuratetransposition of individual humanitarianism to nations has politicised theissue of aid. Extracting from ordinary language and essential principles ofassistance and rationality, politicians turned goodwill into social welfareand insurance programmes more regulated to grasp more power and controlof the society.

Humanitarianism or charity does not, however, guide a foreign nation orgovernment. Foreign aid whether from governments or religious orientedorganisations advances ideological ideals that generally frame donor’sforeign policy or religious establishment. Illustrative is the use of food aid –has helped people to survive in situation of great distress, as a way of


solving surplus production in North America and Western Europe. Whilemillions of people are still starving, Western rich nations have decided toconvert their food surplus into bio-fuel production.

Too much hoopla at the top and less incentives at the bottomIt is no wonder that aid increases the power, the wealth, and the influenceof individuals, institutions, corporations, and countries that are alreadywealthy, influential, and powerful. Donors and campaigners place greatemphasis on the soup kitchens or on how many people are still alive todeflect attention away from things like teaching how to fish for obviousreason. Despite previous failures to make poverty history, and a trackrecord that shows that much effort has gone to hoopla at the top, wealthyindividuals, aid organisations and donor countries surround aid withimpressive accomplishment and promise to end poverty. Yet, Westerngenuine compassion represents only pennies a day from each Westerntaxpayer. While these pennies receive huge coverage in donor countries,they are almost unnoticed at the bottom if they ever arrive.

Summary and Conclusions

The literature review presented in this paper show that foreign aid, a termthat is currently very much in use, is a transposition of personal moralobligation to nations. Donors whether from private or government sectorhave altruistic feelings for the poor in recipient countries, but also,considerations derived from economics or national interests critically affectthe outcomes. In keeping with the development of foreign aid, PresidentTruman is the most important catalyst and an aid wizard. The rise of newand sophisticated aid instruments for economic development ofunderdeveloped countries takes a turning point in 1961 with the creation ofthe DAC of the OECD. The new instruments are, moreover, generally moreconditional to donor foreign policy interests. Only such interests can justifythe current aid flow to China after making so much economic progress13.Therefore, China’s emergence as a donor to African countries hides as wellits own reality of tens of millions of poor. Though it is termed a “win-win”strategy, China’s foreign aid is driven by both natural resources and foreignpolicy reasons.

Learning from Western nations, poor – and rich donors – countries need tomake the necessary modification to aid, and use aid as an opportunity forending the cause of starvation and economic advance. The idea of

13 In 2010, China overtook Japan and became the second largest economy.


absolutely pure and simple aid with no strings attached is an illusion. In itstypical construction aid is patronising and a political act that shapeseverything from donor to local power in the recipient village. It is,however, a matter of political wisdom for the economically poor countriesto spend aid on more meaningful productive factors of production whileminimising political advantage and prestige. For that to happen, aid actorsneed to understand the theoretical basis for aid flows in the moderneconomic structure. The need for further research is therefore urgent.

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the gospel of foreign aid: a theoretical note

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